Picture agency Red Cover claims to have gained the backing of the majority of its contributors to move forward with the business following the issuing of a Company Voluntary Arrangement.
Press Gazette revealed last month that south-London-based Red Cover owed nearly £500,000 to creditors and had told its freelance photographers and writers it would not be able to pay them for up to two years.
Now a formal meeting has been held with a representative group of contributors and creditors, administered by Fisher Partners, Chartered Accountants. A plan to take the company forward under the CVA was approved.
A CVA enables a financially troubled company to reach a binding agreement with its creditors about payment of its debts.
Mark Bezodis, managing director of Red Cover, said: ‘We now have the backing of our contributors to go forward with the business and make the company grow. Obviously they will benefit because they’ll get their money back”.